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LOUIS
VUITTON
Jean Charles Hodouin
LIM New York 2012
Company Background
•Paris,1854
•Trunks, Luggage, Bags
•LV Monograms
•Tradition, Innovation
•1977: 2 Stores.$10m
Background
Background
•

1983 – Louis Vuitton Cup

•

1987 – LVMH is born
•

•

1988 – Profits +49%

1989 – 130 stores worldwide
Background
1990 – Yves Carcelle, President LV
1998 – Marc Jacobs, Artistic Director
2003 – Multi color monogram
Operations
Marketing
Marketing
Marketing
Marketing
Office Management
“Developing knowledge and versatility,
recognizing creativity, encouraging
independence and a continual ...
Financial Management
Legal Management
Old Supply Chain
 Each factory - 250
employees
Each specialized in one
production step
20 to 30 craftsman = 1
Louis Vui...
New Supply Chain
Distribution Process

Manufacturing Process

 2005 –McKinsey & Co

 Pegase

 New products every 6
week...
New Supply Chain
Distribution Process

Overall Results

New store and
distribution strategy

Maintain brand identity +
h...
Technology
Technology in Operations:
 E-learning system EKP
 Training: soft skills, system usage, anti-

counterfeiting-...
Technology
 LANDesk Management Suite
 high PC security
 Maintain on high level of performance
 PC systems up-to-date a...
Technology
 Product Lifecycle Management
 Widely acknowledged in apparel, fashion, and

accessory industry
 End-to-end ...
Technology
Technology in Supply Chain
 I2 solution suite
 Closing the gap between demand and supply
 Demand planning wi...
Partners
JD Edwards
Services
 Integrated modern system which also connect

with the retail system (POS)
 Tool of flexible managem...
DB Schenker
Services
 Integrated network including US, Canada and

Mexico
 Lowest cost
 Quality
 Sustainability
FedEx
Services
 Keep the right mix of product in stock
 Hottest and fast-selling items
 Rush orders
 Web-based FedEx A...
Landsberg
Services
 One stop-source
 Customized boxes
 ISO 9001
 E-truck routing system
McKinsey & Co.
Services
 Fundamental overhaul
 New factory format (Pegase)
 Manufacturing process more flexible
 Ship ...
Best Partners
"Behind the creative magic of Louis
Vuitton is an extremely efficient
supply chain”
 Quality Management Sys...
LOUIS
VUITTON
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Louis Vuitton New Supply Chain

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The house of Louis Vuitton is a leader in the fashion industry due to its devotion to traditional craftsmanship paired with innovative avant-garde. Louis Vuitton now excels in the production of ready to wear, shoes, watches and jewelry in addition to the traditional luggage, bags and accessories. Louis Vuitton owns 17 production workshops, an international logistics center, and exclusive shops worldwide.
Louis Vuitton had to change their manufacturing process to keep up with their customer’s needs and expectations and to maintain and compete for market share. Louis Vuitton’s supply chain process was very inefficient and slow. After several changes they created a modern and efficient supply chain. The supply chain changes resulted in an increased availability of their products in their stores around the world, a new and improved distribution center and store strategy.

Keywords: Luxury, Supply Chain, Innovation, Fashion

Published in: Business, Technology
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Louis Vuitton New Supply Chain

  1. 1. LOUIS VUITTON Jean Charles Hodouin LIM New York 2012
  2. 2. Company Background •Paris,1854 •Trunks, Luggage, Bags •LV Monograms •Tradition, Innovation •1977: 2 Stores.$10m
  3. 3. Background
  4. 4. Background • 1983 – Louis Vuitton Cup • 1987 – LVMH is born • • 1988 – Profits +49% 1989 – 130 stores worldwide
  5. 5. Background 1990 – Yves Carcelle, President LV 1998 – Marc Jacobs, Artistic Director 2003 – Multi color monogram
  6. 6. Operations
  7. 7. Marketing
  8. 8. Marketing
  9. 9. Marketing
  10. 10. Marketing
  11. 11. Office Management “Developing knowledge and versatility, recognizing creativity, encouraging independence and a continual focus on enhancing performance are all integral to our training policy.” ~ LV’s HR 2011
  12. 12. Financial Management
  13. 13. Legal Management
  14. 14. Old Supply Chain  Each factory - 250 employees Each specialized in one production step 20 to 30 craftsman = 1 Louis Vuitton tote bag Hard to transfer employees Difficult to produce more Couldn’t cover the highdemand = Lost Sales Factories not flexible The supply chain process inefficient and slow
  15. 15. New Supply Chain Distribution Process Manufacturing Process  2005 –McKinsey & Co  Pegase  New products every 6 weeks  Carmakers Manufacturing process – lean production  New distribution center  Zero-defect policy  global distribution center outside Paris  6 regional distribution centers around the world  These 6 distribute the products to the stores  13 factories that produce accessories  Employees are less specialized  Organized in team formats
  16. 16. New Supply Chain Distribution Process Overall Results New store and distribution strategy Maintain brand identity + high quality •Keepall Reorganization: Reduced returns 50% •Managers/Feedback Increased sales, increased stock •Right products in the right stores •2 Teams – Stock room/Sales Floor Maintaining10% annual growth for the next several years
  17. 17. Technology Technology in Operations:  E-learning system EKP  Training: soft skills, system usage, anti- counterfeiting-training, internally and externally sourced coursework  Cost-effective, offers educational diversity and flexibility  Easy accessible and user-friendly
  18. 18. Technology  LANDesk Management Suite  high PC security  Maintain on high level of performance  PC systems up-to-date and well-managed  Shortens security patch development times, reduces man-hours, eliminates interruption, reduced network traffic
  19. 19. Technology  Product Lifecycle Management  Widely acknowledged in apparel, fashion, and accessory industry  End-to-end footprint solution  PDM, merchandise, supplier collaboration, & performance-management  Reduction of product failure risks, material costs, process friction & lead times
  20. 20. Technology Technology in Supply Chain  I2 solution suite  Closing the gap between demand and supply  Demand planning with forecasting processes & statistical techniques  Improved forecast accuracy  Increased velocity
  21. 21. Partners
  22. 22. JD Edwards Services  Integrated modern system which also connect with the retail system (POS)  Tool of flexible management and advanced administrative information  Accommodate management of multi-attribute items
  23. 23. DB Schenker Services  Integrated network including US, Canada and Mexico  Lowest cost  Quality  Sustainability
  24. 24. FedEx Services  Keep the right mix of product in stock  Hottest and fast-selling items  Rush orders  Web-based FedEx App
  25. 25. Landsberg Services  One stop-source  Customized boxes  ISO 9001  E-truck routing system
  26. 26. McKinsey & Co. Services  Fundamental overhaul  New factory format (Pegase)  Manufacturing process more flexible  Ship fresh collection every six weeks  Global distribution hub outside Paris
  27. 27. Best Partners "Behind the creative magic of Louis Vuitton is an extremely efficient supply chain”  Quality Management Systems, J.I.T. and fulfillment services  Variety of value-added services including monitoring inventory levels  Support and technology to do so Best Practices
  28. 28. LOUIS VUITTON

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